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Trump Raising Questions About Validity of Details From Turkey; Sandra O'Connor Reveals She Has Dementia; Trump Admin. Gives States New Power Over ObamaCare; Pre-existing Conditions A Key Theme in New York Race. Aired 12:30-1p ET

Aired October 23, 2018 - 12:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[12:30:00] JULIE PACE, WASHINGTON BUREAU CHIEF, AND ASSOCIATED PRESS: I mean, the Saudis have been changing their versions of events going from sort of we know nothing about this to this was a fist fight over the last couple of weeks. And it has put the U.S. in a difficult position.

You know, Turkey is a NATO ally, but not a perfect partner certainly. Certainly not on issues when it comes to treatment of journalists.

So, you know, there is reluctance on the part of this administration to just go with what the Turks' account of this has been. But the Saudis certainly aren't doing their friends in the White House any favors by the way that they have been changing their story over the last couple of weeks.

JOHN KING, CNN ANCHOR: And the president has actually been openly skeptical of the Turks. Number one, he told USA Today yesterday, he still thinks this is a, quote, plot gone awry. That accepts the Saudi explanation that, you know, we knew he was coming. Maybe we're going to interrogate him, but we didn't plan on killing him. That's what the Saudis say, that's what the Saudis say.

The president also said this in the USA Today interview. Trump questioned the validity of at least one detail that has emerged from the incident. Turkish officials have said Khashoggi's body was cut with a bone saw. Asked about that details of possible indication of wrongdoing, Trump sounded incredulous. Do you know there was a bone saw, he replied?

So again, trying to cast doubt. It's clear the president whatever he truly believes, is trying to get to a place where he doesn't have to do too much punishment here because he wants to maintain the relationship.

ELIANA JOHNSON, WHITE HOUSE REPORTER, POLITICO: That's obvious. On the communications front, this is sort of a case in point of the way this administration navigates issues both simple and complex where it takes them about a week, if not more, to get to a sort of consistent message and who knows if Pence's message is going to be the they stick with. Which is why -- which present a difficulty in covering the administration and figuring out where they stand on issues, because at times their officials are at odds with each other. This is something I was saying a week ago, are we going to see top officials diverge from where the president is? And I think Pence is sort of the first that we're seeing of that.

MOLLY BALL, NATIONAL POLITICAL CORRESPONDENT, TIME: But both of the Turks and the Saudis have been playing a risky game here, right? Because the challenge for the Turks was all going to be, they made very strong assertions very early on about the evidence that they had, claiming that it was iron-clad. And so they have got to show that that's actually the case or else it is going to look like they simply had an ax to grind.

On the other hand, the Saudis, it has been frankly puzzling from the start that the Saudis would make such easily falsifiable false claims about what happened. For example, claiming that he left the consulate when they had to know the information was going to come out to the contrary. And that was going to jeopardize particularly the relationship with Washington even more because as you reported, Trump is then going to feel betrayed by having been lied to by the Saudis.

KING: But the Saudis are accustomed to buying their version of the truth. That's part of it. They used their money to buy their version of the truth when people just not. What I don't understand to your point about the administration coming up with a plan, the treasury secretary decided to go ahead with the trip to Saudi Arabia. He did not go to the big investment conference. That was bit of a snob. He did, he was asked for a meeting with the crown prince.

The crown prince runs Saudi Arabia. The son of the king runs the country. No reason why not. The crown prince wants to talk to you at this key sensitive moment, you talk to the crown prince. It's an important relationship, maybe he'll tell you something about the investigation but why allow the Saudis to do this?

The foreign ministry in the middle of all this where the world is trying to push the Saudis and isolate the Saudis and demand answers from the Saudis, truthful answers from the Saudis, why allow them this propaganda ploy of the crown prince. Why not say we'll meet with you, but no photos, period. Why?

SAHIL KAPUR, NATIONAL POLITICAL REPORTER, BLOOMBERG: They are clearly wrestling with how to go about this and I think the president has made a shift in his rhetoric from his initial response which seemed to be -- which seemed to indicate a president who wanted to get to yes in the Saudi narrative and, you know, who wanted to find a reason to accept their version of events and continue with his relationship that his White House has put a lot of stock in. But the facts are piling up, the evidence is piling up and the Turks now seem adamant that Saudi Arabia was involved.

There was video I think of a body double, you know, walking out in Khashoggi's clothes which is a powerful, a really, really powerful piece of evidence that this was, you know, a premeditated and planned murder. And the president's comments in the New York Times indicated all. He said -- I'm quoting here, this one has caught the imagination of the world, unfortunately, unquote. KING: Unfortunately. Prefer not to have this to deal with.

PACE: He would prefer to not have this problem because he thinks that the relationship with Saudi Arabia helps the U.S. on both the counterterrorism front and on the economic front and for him both of those take priority over human rights, over Democratic values.

KING: When we come back, remember the president always says his White House is a well-oiled machine. Next, a heated altercation that turned physical just outside the president's office. Details on that dust up in a moment.

(COMMERCIAL BREAK)

[12:39:06] KING: Topping our political radar today, big losses on Wall Street fueled partly by the ongoing trade war with China. The Dow Industrial is down, you see it right there, 317 points right now after more disappointing earnings reports from companied like 3M and Caterpillar. A closely watch parameter of economic growth.

Investors cite increased fear over the impact of the president's steel and aluminum tariffs. Harley Davidson fell about six percent l after reporting a 13 percent drop in U.S. sales.

President Trump could have another meeting with his Russian counterpart just weeks from now. During talks in Moscow, Vladimir Putin told National Security Adviser John Bolton, quote, it would be useful to continue direct dialogue with the president. Putin proposed early next month when both leaders are in Paris for World War I commemorations.

Two sources confirming now to CNN that the White House Chief of Staff John Kelly and the former presidential campaign manager Corey Lewandowski almost came to blows during a heated argument in the West Wing, this back in February. The New York Times first reported the story and says Secret Service agents had to intervene after Kelly grabbed Lewandowski by the collar.

[12:40:06] Before it happened, the Times says Kelly wanted Lewandowski removed from the building after a meeting with the president.

In Georgia, a 1992 photo surfaces that could affect the governor's race right before the candidate's first debate. That debate is tonight. A photo shows the Democratic nominee Stacey Abrams burning the state flag which at the time still included the Confederate battle emblem. Abrams campaign acknowledges she took part in a peaceful and permitted protest that eventually led to the emblem's removal.

Also in Georgia, a battery lawsuit against Republican Senator David Perdue. A college student is suing, complaining the senator grabbed his phone after the student asked a pointed question about that Georgia governor's race. His spokesman says Perdue took the phone because he thought the student wanted a selfie with him (INAUDIBLE) and give it right back.

And some sad news today about retired Supreme Court Justice Sandra Day O'Connor. She revealed in a letter today she's in the early stages of dementia, most likely Alzheimer's disease she writes. O'Connor made history back in 1981 as the country's first female Supreme Court justice. After retiring, she once talked about how she was on the shortest of short list when President Reagan went looking for his nominee.

(BEGIN VIDEO CLIP)

SANDRA DAY O'CONNOR, FORMER SUPREME COURT JUSTICE: Because President Reagan had indicated during his campaign that if he had a chance, he'd like to put a qualified woman on the Supreme Court. And Attorney General Smith again collecting a few names, well, his list was pretty short because there weren't many women judges and there were even fewer Republican women judges. So his list was pretty short. He kept it under his telephone at the Department of Justice.

And sure enough, there was a vacancy and William French Smith put out his pitiful little list and there I was. So I ended up on the court.

(END VIDEO CLIP)

KING: Sad news. Sad news there. Delightful and humorous person in addition to being a history maker and a trailblazer on the court. I just had a chance to bump into her on randomly a couple of times on trips and just casual conversations, she was a delight. Just wonderful.

BALL: Also the author of a children's book that my children have and that I have tried to read to them, but frankly she did not miss her calling. There were too many words in it. She was a much better judge than author.

KAPUR: And argue we have the last real swing vote on the Supreme Court. She actively looked for middle ground on these issues and she sided with the left a lot, she sided with the right a lot. Anthony Kennedy has talked about as a swing vote because he is the median vote on this court. He's mostly conservative on a wrath of issues and had some quirky libertarian views on things like abortion and gay rights that have landed him with luck. But Sandra Day O'Connor was different. She was conscious of public opinion, she found a middle ground things like affirmative action and campaign finance and abortion. On the latter too, she was replaced with Samuel Alito who tilt the court to the right basically reversed decisions that she made.

KING: A westerner, she loved the west. I bumped on her in Arizona, she loved out there. We wish Justice O'Connor the best obviously.

Up next, President Trump making more changes to healthcare. But is he keeping his promise to protect those who have pre-existing conditions?

(COMMERCIAL BREAK)

[12:47:09] KING: Welcome back.

Two weeks left in campaign 2018. And there's A big parallel to 2014 and 2010. In both of those midterm years, ObamaCare, healthcare was a huge issue, so it is this year. There's a big difference.

Look at this Fox News poll. ObamaCare is actually popular. Fifty- three percent have a favorable opinion of ObamaCare. That makes the Democrats argument better they think and it complicates things for Republicans.

Let's take a look at this. ObamaCare's approval spiked in October 2017, back then it was low. Look at this, plus 11. A net plus 11 for ObamaCare heading into a midterm election year in which the Democrats want to talk a lot about healthcare. Look at these numbers among traditionally Republican voters. Men, white voters, older voters, independence.

What's more important to you? What are you extremely concerned about? Pre-existing conditions or government take over? Pre-existing conditions. That's a big concern for people significantly more so than the idea Republicans often say which is give the Democrats power, you'll have a government take over.

Another thing Democrats like to say when Republicans say, hey, we're all for protecting you if you have pre-existing conditions, they like to point out, all these states with Republican governors are suing to get rid of ObamaCare.

But on the campaign trail, the president, he's mindful of the Democratic arguments he says, and he tells you the Democrats are lying. Republicans will protect your healthcare.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Republicans want to protect Medicare for our great seniors who have earned it and who have paid for it for a long time. And Republicans will always protect Americans with pre-existing conditions. We protect you. Pre-existing conditions. Right?

(END VIDEO CLIP)

KING: Now President Trump has not gotten rid of ObamaCare as he promised, but he has made some changes like repealing the individual mandate penalty and slowly giving states more power. Starting this week, states can now apply for waivers to create and fund ObamaCare alternatives. The Senate Minority Leader Chuck Schumer responded to that yesterday saying, quote, the administration plainly admitted its intention is to use taxpayer dollars to fund junk insurance that don't cover pre-existing conditions which could lead to medical bankruptcy for many American families in order to pad the pockets of health insurance executives.

Is that right? Let's get to the bottom of all of that. CNN's Tami Luhby joins us now from New York. Who do these changes help and who do they hurt?

TAMI LUHBY, CNN SENIOR WRITER: Well, one of the most important things that this new waiver rule is going to do is it going to allow states to let people buy coverage with the ObamaCare subsidies. But this coverage is going to be short-term plans or it could be short-term plans. And this is what Schumer is calling junk insurance.

Now these short-term plans which lasts less than a year may be very attractive to people who are younger and healthier because they have lower premiums and they don't offer a lot of benefits. So that's how they could end up hurting people who are older who have pre-existing conditions.

[12:50:04] Because they can -- these short-term plans could deny coverage or charge people more based on their medical histories and they don't have to offer all of ObamaCare's comprehensive policies.

Now, the fear is that what's going to awful happen is if all of these younger and healthier people are moving to short-term plans and ObamaCare exchanges are left with people who are older and sicker, the premiums are going to go up and it's going to make ObamaCare policies even less affordable.

KING: That's the big question there. And the bottom line, President Trump on the trail said he's protecting people with pre-existing conditions. Is he?

LUHBY: Well, no. And here is a perfect example. His Justice Department is actually arguing that these protections should be invalidated. It's all part of a lawsuit that Republican attorney generals in Texas -- or Republican attorney generals have brought in Texas. The attorney generals are arguing that the entire ACA law should be invalidated because of the -- of Congress repealing the individual mandate penalty.

Now the Justice Department could have tried to defend the law but they're not. And what are they actually arguing? They're arguing that these very protections for people with pre-existing conditions are no longer valid.

KING: Tami Luhby, appreciate the actual facts and policy in the middle of a campaign debate that often veers away. Appreciate that.

Let's bring it in the room. This is -- Democrats want this to be the defining issue and then many -- if you go race to race, look at the T.V. ads, it has been at least on television. And voters when you ask them, they talk about the economy and healthcare pretty high up.

Can Democrats close the sale? Their argument essentially is, this president and this party, the Republicans, they want to throw ObamaCare away and they don't care about you. The Republicans say yes, we do, but we just don't like this way.

BALL: Well, you know, it is very striking and remarkable that you see both the Democrats and the Republicans making the same claim, making the same argument. And what it tells you is that they have seen a lot of polls just like that one that you just showed on screen. This is what people are concerned about.

Both the Democrats and Republicans want to claim that they are the ones protecting pre-existing conditions. I was in Wisconsin last week and this is -- the Republicans are scrambling to do everything they can to reassure voters, they're talking about it almost as much as the Democrats because they know what a concern this is for voters.

I think beyond the nitty-gritty of the policy which is of course important, none of this has actually happened yet. It's all pretty much hypothetical for people. It's something that can happen the next time they have the opportunity to buy insurance. And so what is going to matter for the midterms is, who do voters believe.

Who do voters believe is going to protect their healthcare? Who do voters think has as more of a priority? And polls have consistently shown that the Democrats do have an edge on that particular claim.

KAPUR: What (INAUDIBLE) timing for the administration to put out this move two weeks before the election right when President Trump is traveling the country and candidates are traveling the country saying they want to protect people with pre-existing conditions? Because what this rule would allow is for states to create a parallel market for insurance plans that don't have to abide by rules like community rating and covering an essential minimum set of benefits.

And, you know, for the first time, they'll be able to use federal subsidies to cover those plans which is a huge incentive for states to go down that road. The administration has attacked the pre-existing conditions rules from a legislative standpoint, from a regulatory standpoint, and from a court standpoint. So the Democrats do have an argument to make and it plays right into their hands here.

PACE: And the lawsuit that you were talking about there makes it difficult for some of these candidates, you're talking about Wisconsin, some like a Scott Walker who says, I'm going to protect pre-existing conditions. And the Democratic argument back to him is, well, why don't you just pull your state out of this lawsuit?

KING: (INAUDIBLE) the Senate candidate --

PACE: They're in the same position --

KING: -- the attorney general who (INAUDIBLE).

PACE: This was a tough argument.

KAPUR: Even, you know, Joe Manchin, Claire McCaskill, Heidi Heitkamp found an issue that works even in the reddest of states.

JOHNSON: Well, what's astonishing to me is this extent to what Republicans have moderated their rhetoric and to some extent their positions on the issue of entitlements. Donald Trump I think his victory in the election based on his campaign rhetoric which is I'm not taking anything away from anybody, showed conservatives that cutting entitlements, an issue they had ran on for decades was not as compelling to their base voters as they had seen.

And you saw that I think during the ObamaCare repeal debate where a lot of Republicans got skittish because they realized that Trump had campaigned on this, it was compelling. Their voters did not want an ObamaCare repeal. And I think Republicans' rhetoric on this is reflected in the midterm campaign in the fall. KING: And in the midterm campaigns, it reflects this way. This is New York '19, one of many races around the country, Republican-held district now. If Democrats want to take it away where healthcare is the flash point.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Congressman John Faso broke his promise to protect people with pre-existing conditions. But did you know Faso broke his promise to seniors, too. He took thousands from insurance interests and voted to let them raise prices on older New Yorkers twice.

What's Delgado hiding? He supports moving to a government healthcare plan that would eliminate employer-paid coverage. Forcing us all into a government-run system, putting Washington bureaucrats in charge.

(END VIDEO CLIP)

[12:55:03] KING: It is -- it's good to have campaigns that are actually about policy, if, if when it's over, and we know the winners and the losers, they follow that and they say this issue was litigated, this is what the people want.

PACE: I think that's really --

KING: Naive of me?

PACE: -- what I also imagined in the next two years. I forget all (INAUDIBLE), we'll be barreling (INAUDIBLE) to 2020. Healthcare is a tough issue that a lot of lawmakers weren't actually want to work on.

KING: It is striking though --

KAPUR: Healthcare would be a big conversation obviously on the 2020 Democratic primaries.

KING: You know, Democrats ran from ObamaCare in 2010, in 2014. They're giving it a big hug this time.

Thanks for joining us in the INSIDE POLITICS. See you back here this time tomorrow. Wolf starts after a quick break.

Have a great day.

(COMMERCIAL BREAK)

WOLF BLITZER, CNN ANCHOR: Hello, I'm Wolf Blitzer. It's 1 p.m. here in Washington. Thanks very much for joining us.